Key Takeaways
- The bitcoin price fell below $67,000 on Tuesday morning.
- Tomorrow’s CPI data release and Federal Reserve meeting could further impact the bitcoin price.
- Bitcoin’s price drop followed the spot bitcoin ETF market’s first day of net outflows in 20 days.
- Various crypto-focused stocks, such as Microstrategy, Marathon Digital, and Coinbase also fell.
Bitcoin Price Movement and Market Factors
The bitcoin price (BTC) fell below $67,000 Tuesday after the spot bitcoin exchange-traded fund (ETF) market saw its first day of net outflows in nearly three weeks on Monday as bitcoin investors get nervous ahead of inflation data and an influential interest rate decision.
Bitcoin investors, not unlike investors in other risk assets like stocks, are closely watching the Consumer Price Index (CPI) inflation data release Wednesday morning and the outcome of the Federal Reserve’s policy meeting that afternoon.
The inflation print and Fed Chair Jerome Powell’s remarks will inform the market’s expectations on when the central bank will move to cut rates and how by how much. Higher-for-longer rates have pushed up bond yields, making riskier assets like bitcoin less attractive to investors.
Bitcoin ETFs Performance
On Friday, it seemed like a new all-time high for bitcoin was right around the corner, as the price neared the $72,000 mark; however, it’s been pretty much downhill since then. The bitcoin price fell below $67,000 for the first time this month on Tuesday, a roughly 7% drop from the Friday high.
Spot bitcoin ETFs, such as BlackRock’s iShares Bitcoin Trust (IBIT), GrayScale’s Bitcoin Trust (GBTC) and Fidelity’s Wise Origin Bitcoin Fund (FBTC), which closely track the price of the cryptocurrency, were also trading lower Tuesday.
The most recent drop in the bitcoin price followed the first day of net outflows for the U.S. spot bitcoin ETF market in 20 days. According to data from Farside Investors, yesterday’s outflows came in at $64.9 million.
Impact on Bitcoin-Related Stocks
As bitcoin tumbled, it dragged some of the largest crypto-related stocks with it.
Shares in Microstrategy (MSTR), which held 214,278 bitcoins worth $5.074 billion at the end of the first quarter, fell roughly 6% in trade Tuesday. Despite the fall this week, the stock has more than doubled since the beginning of the year.
Bitcoin miners, big and small, also suffered losses in intra-day trading. Marathon Digital Holdings (MARA), and Riot Platforms (RIOT) saw their shares drop roughly 6% each. Among the smaller miners, Hut 8 (HUT) shares fell 8%, CleanSpark (CLSK) stock was 7% lower while Bitdeer (BTDR) shares were down about 5%.
Shares in crypto trading platforms such as Coinbase Global (COIN) were 5% lower while Robinhood (HOOD) stock slid more than 3%.
